Income Tax Expense (Benefit)
Effective Income Tax Rate (EITR)
Components of Deferred Tax Assets and Liabilities
Deferred Tax Assets and Liabilities, Classification
Adjustments to Financial Statements: Removal of Deferred Taxes
Adjusted Financial Ratios: Removal of Deferred Taxes (Summary)
Adjusted Net Profit Margin
Adjusted Total Asset Turnover
Adjusted Financial Leverage
Adjusted Return on Equity (ROE)
Adjusted Return on Assets (ROA)

Netflix Inc., income tax expense (benefit), continuing operations

US$ in thousands

12 months ended:	Dec 31, 2024	Dec 31, 2023	Dec 31, 2022	Dec 31, 2021	Dec 31, 2020
Federal	1,093,667)	854,170)	109,910)	57,526)	24,221)
State	214,814)	181,684)	119,795)	109,641)	65,821)
Foreign	536,915)	304,539)	676,827)	357,189)	277,846)
Current tax provision	1,845,396)	1,340,393)	906,532)	524,356)	367,888)
Federal	(520,510)	(412,760)	(52,434)	188,937)	(57,765)
State	(41,700)	(55,475)	(30,691)	(2,700)	164,685)
Foreign	(29,160)	(74,743)	(51,402)	13,282)	(36,854)
Deferred tax provision	(591,370)	(542,978)	(134,527)	199,519)	70,066)
Provision for income taxes	1,254,026)	797,415)	772,005)	723,875)	437,954)

Based on: 10-K (reporting date: 2024-12-31), 10-K (reporting date: 2023-12-31), 10-K (reporting date: 2022-12-31), 10-K (reporting date: 2021-12-31), 10-K (reporting date: 2020-12-31).

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Item	Description	The company
Current tax provision	Amount of current income tax expense (benefit) pertaining to taxable income (loss) from continuing operations.	Netflix Inc. current tax provision increased from 2022 to 2023 and from 2023 to 2024.
Deferred tax provision	Amount of deferred income tax expense (benefit) pertaining to income (loss) from continuing operations.	Netflix Inc. deferred tax provision decreased from 2022 to 2023 and from 2023 to 2024.
Provision for income taxes	Amount of current income tax expense (benefit) and deferred income tax expense (benefit) pertaining to continuing operations.	Netflix Inc. provision for income taxes increased from 2022 to 2023 and from 2023 to 2024.

Netflix Inc., effective income tax rate (EITR) reconciliation

		Dec 31, 2024	Dec 31, 2023	Dec 31, 2022	Dec 31, 2021	Dec 31, 2020
	U.S. federal statutory tax rate	21.00%	21.00%	21.00%	21.00%	21.00%
	Effective tax rate	13.00%	13.00%	15.00%	12.00%	14.00%

Based on: 10-K (reporting date: 2024-12-31), 10-K (reporting date: 2023-12-31), 10-K (reporting date: 2022-12-31), 10-K (reporting date: 2021-12-31), 10-K (reporting date: 2020-12-31).

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Item	Description	The company
Effective tax rate	Percentage of current income tax expense (benefit) and deferred income tax expense (benefit) pertaining to continuing operations.

Netflix Inc., components of deferred tax assets and liabilities

US$ in thousands

	Dec 31, 2024	Dec 31, 2023	Dec 31, 2022	Dec 31, 2021	Dec 31, 2020
Stock-based compensation	440,889)	486,876)	443,456)	351,238)	296,646)
Tax credits and net operating loss carryforwards	834,402)	544,431)	409,411)	494,881)	543,307)
Capitalized research expenses	1,075,474)	593,439)	323,998)	—)	—)
Accruals and reserves	152,142)	137,251)	119,732)	165,214)	74,239)
Operating lease liabilities	522,489)	516,574)	551,418)	570,830)	436,838)
OCI hedging losses	—)	35,707)	—)	—)	—)
Unrealized losses	12,157)	26,506)	—)	13,772)	114,884)
Other	18,197)	11,615)	2,234)	5,420)	2,543)
Gross deferred tax assets	3,055,750)	2,352,399)	1,850,249)	1,601,355)	1,468,457)
Valuation allowance	(540,272)	(442,293)	(343,342)	(318,408)	(249,844)
Deferred tax assets	2,515,478)	1,910,106)	1,506,907)	1,282,947)	1,218,613)
Depreciation & amortization	(370,709)	(357,477)	(456,717)	(388,115)	(229,142)
Operating right-of-use lease assets	(449,661)	(435,216)	(473,928)	(506,403)	(400,380)
OCI hedging gains	(220,009)	—)	—)	—)	—)
Unrealized gains	—)	—)	(47,283)	—)	—)
Acquired intangibles	(282,187)	(233,433)	(267,438)	(240,334)	—)
Other	(15,354)	(9,430)	—)	—)	—)
Deferred tax liabilities	(1,337,920)	(1,035,556)	(1,245,366)	(1,134,852)	(629,522)
Net deferred tax assets (liabilities)	1,177,558)	874,550)	261,541)	148,095)	589,091)

Based on: 10-K (reporting date: 2024-12-31), 10-K (reporting date: 2023-12-31), 10-K (reporting date: 2022-12-31), 10-K (reporting date: 2021-12-31), 10-K (reporting date: 2020-12-31).

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Item	Description	The company
Gross deferred tax assets	Amount before allocation of valuation allowances of deferred tax asset attributable to deductible temporary differences and carryforwards.	Netflix Inc. gross deferred tax assets increased from 2022 to 2023 and from 2023 to 2024.
Deferred tax assets	Amount after allocation of valuation allowances of deferred tax asset attributable to deductible temporary differences and carryforwards.	Netflix Inc. deferred tax assets increased from 2022 to 2023 and from 2023 to 2024.
Net deferred tax assets (liabilities)	Amount, after allocation of valuation allowances and deferred tax liability, of deferred tax asset attributable to deductible differences and carryforwards, without jurisdictional netting.	Netflix Inc. net deferred tax assets (liabilities) increased from 2022 to 2023 and from 2023 to 2024.

Netflix Inc., deferred tax assets and liabilities, classification

US$ in thousands

		Dec 31, 2024	Dec 31, 2023	Dec 31, 2022	Dec 31, 2021	Dec 31, 2020
	Deferred tax assets (classified as Other non-current assets)	1,290,160)	1,000,760)	261,541)	148,095)	589,091)
	Deferred tax liabilities (classified as Other non-current liabilities)	112,602)	126,210)	—)	—)	—)

Based on: 10-K (reporting date: 2024-12-31), 10-K (reporting date: 2023-12-31), 10-K (reporting date: 2022-12-31), 10-K (reporting date: 2021-12-31), 10-K (reporting date: 2020-12-31).

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Item	Description	The company
Deferred tax assets (classified as Other non-current assets)	Amount, after allocation of valuation allowances and deferred tax liability, of deferred tax asset attributable to deductible differences and carryforwards, with jurisdictional netting and classified as noncurrent.	Netflix Inc. deferred tax assets (classified as Other non-current assets) increased from 2022 to 2023 and from 2023 to 2024.
Deferred tax liabilities (classified as Other non-current liabilities)	Amount, after deferred tax asset, of deferred tax liability attributable to taxable differences, with jurisdictional netting and classified as noncurrent.	Netflix Inc. deferred tax liabilities (classified as Other non-current liabilities) increased from 2022 to 2023 but then slightly decreased from 2023 to 2024.

Netflix Inc., adjustments to financial statements

US$ in thousands

	Dec 31, 2024	Dec 31, 2023	Dec 31, 2022	Dec 31, 2021	Dec 31, 2020
Adjustment to Total Assets
Total assets (as reported)	53,630,374)	48,731,992)	48,594,768)	44,584,663)	39,280,359)
Less: Noncurrent deferred tax assets, net	1,290,160)	1,000,760)	261,541)	148,095)	589,091)
Total assets (adjusted)	52,340,214)	47,731,232)	48,333,227)	44,436,568)	38,691,268)
Adjustment to Total Liabilities
Total liabilities (as reported)	28,886,807)	28,143,679)	27,817,367)	28,735,415)	28,215,119)
Less: Noncurrent deferred tax liabilities, net	112,602)	126,210)	—)	—)	—)
Total liabilities (adjusted)	28,774,205)	28,017,469)	27,817,367)	28,735,415)	28,215,119)
Adjustment to Stockholders’ Equity
Stockholders’ equity (as reported)	24,743,567)	20,588,313)	20,777,401)	15,849,248)	11,065,240)
Less: Net deferred tax assets (liabilities)	1,177,558)	874,550)	261,541)	148,095)	589,091)
Stockholders’ equity (adjusted)	23,566,009)	19,713,763)	20,515,860)	15,701,153)	10,476,149)
Adjustment to Net Income
Net income (as reported)	8,711,631)	5,407,990)	4,491,924)	5,116,228)	2,761,395)
Add: Deferred income tax expense (benefit)	(591,370)	(542,978)	(134,527)	199,519)	70,066)
Net income (adjusted)	8,120,261)	4,865,012)	4,357,397)	5,315,747)	2,831,461)

Based on: 10-K (reporting date: 2024-12-31), 10-K (reporting date: 2023-12-31), 10-K (reporting date: 2022-12-31), 10-K (reporting date: 2021-12-31), 10-K (reporting date: 2020-12-31).

Netflix Inc., Financial Data: Reported vs. Adjusted

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Netflix Inc., adjusted financial ratios

	Dec 31, 2024	Dec 31, 2023	Dec 31, 2022	Dec 31, 2021	Dec 31, 2020
Net Profit Margin
Reported net profit margin	22.34%	16.04%	14.21%	17.23%	11.05%
Adjusted net profit margin	20.82%	14.43%	13.78%	17.90%	11.33%
Total Asset Turnover
Reported total asset turnover	0.73	0.69	0.65	0.67	0.64
Adjusted total asset turnover	0.75	0.71	0.65	0.67	0.65
Financial Leverage
Reported financial leverage	2.17	2.37	2.34	2.81	3.55
Adjusted financial leverage	2.22	2.42	2.36	2.83	3.69
Return on Equity (ROE)
Reported ROE	35.21%	26.27%	21.62%	32.28%	24.96%
Adjusted ROE	34.46%	24.68%	21.24%	33.86%	27.03%
Return on Assets (ROA)
Reported ROA	16.24%	11.10%	9.24%	11.48%	7.03%
Adjusted ROA	15.51%	10.19%	9.02%	11.96%	7.32%

Based on: 10-K (reporting date: 2024-12-31), 10-K (reporting date: 2023-12-31), 10-K (reporting date: 2022-12-31), 10-K (reporting date: 2021-12-31), 10-K (reporting date: 2020-12-31).

Financial ratio	Description	The company
Adjusted net profit margin	An indicator of profitability, calculated as adjusted net income divided by total revenue.	Netflix Inc. adjusted net profit margin ratio improved from 2022 to 2023 and from 2023 to 2024.
Adjusted total asset turnover	An activity ratio calculated as total revenue divided by adjusted total assets.	Netflix Inc. adjusted total asset turnover ratio improved from 2022 to 2023 and from 2023 to 2024.
Adjusted financial leverage	A measure of financial leverage calculated as adjusted total assets divided by adjusted total equity. Financial leverage is the extent to which a company can effect, through the use of debt, a proportional change in the return on common equity that is greater than a given proportional change in operating income.	Netflix Inc. adjusted financial leverage ratio increased from 2022 to 2023 but then decreased significantly from 2023 to 2024.
Adjusted ROE	A profitability ratio calculated as adjusted net income divided by adjusted shareholders’ equity.	Netflix Inc. adjusted ROE improved from 2022 to 2023 and from 2023 to 2024.
Adjusted ROA	A profitability ratio calculated as adjusted net income divided by adjusted total assets.	Netflix Inc. adjusted ROA improved from 2022 to 2023 and from 2023 to 2024.

Netflix Inc., Financial Ratios: Reported vs. Adjusted

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	Dec 31, 2024	Dec 31, 2023	Dec 31, 2022	Dec 31, 2021	Dec 31, 2020
As Reported
Selected Financial Data (US$ in thousands)
Net income	8,711,631)	5,407,990)	4,491,924)	5,116,228)	2,761,395)
Revenues	39,000,966)	33,723,297)	31,615,550)	29,697,844)	24,996,056)
Profitability Ratio
Net profit margin¹	22.34%	16.04%	14.21%	17.23%	11.05%
Adjusted for Deferred Taxes
Selected Financial Data (US$ in thousands)
Adjusted net income	8,120,261)	4,865,012)	4,357,397)	5,315,747)	2,831,461)
Revenues	39,000,966)	33,723,297)	31,615,550)	29,697,844)	24,996,056)
Profitability Ratio
Adjusted net profit margin²	20.82%	14.43%	13.78%	17.90%	11.33%

Based on: 10-K (reporting date: 2024-12-31), 10-K (reporting date: 2023-12-31), 10-K (reporting date: 2022-12-31), 10-K (reporting date: 2021-12-31), 10-K (reporting date: 2020-12-31).

2024 Calculations

¹ Net profit margin = 100 × Net income ÷ Revenues
= 100 × 8,711,631 ÷ 39,000,966 = 22.34%

² Adjusted net profit margin = 100 × Adjusted net income ÷ Revenues
= 100 × 8,120,261 ÷ 39,000,966 = 20.82%

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Profitability ratio	Description	The company
Adjusted net profit margin	An indicator of profitability, calculated as adjusted net income divided by total revenue.	Netflix Inc. adjusted net profit margin ratio improved from 2022 to 2023 and from 2023 to 2024.

	Dec 31, 2024	Dec 31, 2023	Dec 31, 2022	Dec 31, 2021	Dec 31, 2020
As Reported
Selected Financial Data (US$ in thousands)
Revenues	39,000,966)	33,723,297)	31,615,550)	29,697,844)	24,996,056)
Total assets	53,630,374)	48,731,992)	48,594,768)	44,584,663)	39,280,359)
Activity Ratio
Total asset turnover¹	0.73	0.69	0.65	0.67	0.64
Adjusted for Deferred Taxes
Selected Financial Data (US$ in thousands)
Revenues	39,000,966)	33,723,297)	31,615,550)	29,697,844)	24,996,056)
Adjusted total assets	52,340,214)	47,731,232)	48,333,227)	44,436,568)	38,691,268)
Activity Ratio
Adjusted total asset turnover²	0.75	0.71	0.65	0.67	0.65

Based on: 10-K (reporting date: 2024-12-31), 10-K (reporting date: 2023-12-31), 10-K (reporting date: 2022-12-31), 10-K (reporting date: 2021-12-31), 10-K (reporting date: 2020-12-31).

2024 Calculations

¹ Total asset turnover = Revenues ÷ Total assets
= 39,000,966 ÷ 53,630,374 = 0.73

² Adjusted total asset turnover = Revenues ÷ Adjusted total assets
= 39,000,966 ÷ 52,340,214 = 0.75

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Activity ratio	Description	The company
Adjusted total asset turnover	An activity ratio calculated as total revenue divided by adjusted total assets.	Netflix Inc. adjusted total asset turnover ratio improved from 2022 to 2023 and from 2023 to 2024.

	Dec 31, 2024	Dec 31, 2023	Dec 31, 2022	Dec 31, 2021	Dec 31, 2020
As Reported
Selected Financial Data (US$ in thousands)
Total assets	53,630,374)	48,731,992)	48,594,768)	44,584,663)	39,280,359)
Stockholders’ equity	24,743,567)	20,588,313)	20,777,401)	15,849,248)	11,065,240)
Solvency Ratio
Financial leverage¹	2.17	2.37	2.34	2.81	3.55
Adjusted for Deferred Taxes
Selected Financial Data (US$ in thousands)
Adjusted total assets	52,340,214)	47,731,232)	48,333,227)	44,436,568)	38,691,268)
Adjusted stockholders’ equity	23,566,009)	19,713,763)	20,515,860)	15,701,153)	10,476,149)
Solvency Ratio
Adjusted financial leverage²	2.22	2.42	2.36	2.83	3.69

Based on: 10-K (reporting date: 2024-12-31), 10-K (reporting date: 2023-12-31), 10-K (reporting date: 2022-12-31), 10-K (reporting date: 2021-12-31), 10-K (reporting date: 2020-12-31).

2024 Calculations

¹ Financial leverage = Total assets ÷ Stockholders’ equity
= 53,630,374 ÷ 24,743,567 = 2.17

² Adjusted financial leverage = Adjusted total assets ÷ Adjusted stockholders’ equity
= 52,340,214 ÷ 23,566,009 = 2.22

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Solvency ratio	Description	The company
Adjusted financial leverage	A measure of financial leverage calculated as adjusted total assets divided by adjusted total equity. Financial leverage is the extent to which a company can effect, through the use of debt, a proportional change in the return on common equity that is greater than a given proportional change in operating income.	Netflix Inc. adjusted financial leverage ratio increased from 2022 to 2023 but then decreased significantly from 2023 to 2024.

	Dec 31, 2024	Dec 31, 2023	Dec 31, 2022	Dec 31, 2021	Dec 31, 2020
As Reported
Selected Financial Data (US$ in thousands)
Net income	8,711,631)	5,407,990)	4,491,924)	5,116,228)	2,761,395)
Stockholders’ equity	24,743,567)	20,588,313)	20,777,401)	15,849,248)	11,065,240)
Profitability Ratio
ROE¹	35.21%	26.27%	21.62%	32.28%	24.96%
Adjusted for Deferred Taxes
Selected Financial Data (US$ in thousands)
Adjusted net income	8,120,261)	4,865,012)	4,357,397)	5,315,747)	2,831,461)
Adjusted stockholders’ equity	23,566,009)	19,713,763)	20,515,860)	15,701,153)	10,476,149)
Profitability Ratio
Adjusted ROE²	34.46%	24.68%	21.24%	33.86%	27.03%

Based on: 10-K (reporting date: 2024-12-31), 10-K (reporting date: 2023-12-31), 10-K (reporting date: 2022-12-31), 10-K (reporting date: 2021-12-31), 10-K (reporting date: 2020-12-31).

2024 Calculations

¹ ROE = 100 × Net income ÷ Stockholders’ equity
= 100 × 8,711,631 ÷ 24,743,567 = 35.21%

² Adjusted ROE = 100 × Adjusted net income ÷ Adjusted stockholders’ equity
= 100 × 8,120,261 ÷ 23,566,009 = 34.46%

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Profitability ratio	Description	The company
Adjusted ROE	A profitability ratio calculated as adjusted net income divided by adjusted shareholders’ equity.	Netflix Inc. adjusted ROE improved from 2022 to 2023 and from 2023 to 2024.

	Dec 31, 2024	Dec 31, 2023	Dec 31, 2022	Dec 31, 2021	Dec 31, 2020
As Reported
Selected Financial Data (US$ in thousands)
Net income	8,711,631)	5,407,990)	4,491,924)	5,116,228)	2,761,395)
Total assets	53,630,374)	48,731,992)	48,594,768)	44,584,663)	39,280,359)
Profitability Ratio
ROA¹	16.24%	11.10%	9.24%	11.48%	7.03%
Adjusted for Deferred Taxes
Selected Financial Data (US$ in thousands)
Adjusted net income	8,120,261)	4,865,012)	4,357,397)	5,315,747)	2,831,461)
Adjusted total assets	52,340,214)	47,731,232)	48,333,227)	44,436,568)	38,691,268)
Profitability Ratio
Adjusted ROA²	15.51%	10.19%	9.02%	11.96%	7.32%

Based on: 10-K (reporting date: 2024-12-31), 10-K (reporting date: 2023-12-31), 10-K (reporting date: 2022-12-31), 10-K (reporting date: 2021-12-31), 10-K (reporting date: 2020-12-31).

2024 Calculations

¹ ROA = 100 × Net income ÷ Total assets
= 100 × 8,711,631 ÷ 53,630,374 = 16.24%

² Adjusted ROA = 100 × Adjusted net income ÷ Adjusted total assets
= 100 × 8,120,261 ÷ 52,340,214 = 15.51%

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Profitability ratio	Description	The company
Adjusted ROA	A profitability ratio calculated as adjusted net income divided by adjusted total assets.	Netflix Inc. adjusted ROA improved from 2022 to 2023 and from 2023 to 2024.

Netflix Inc. (NASDAQ:NFLX)

Analysis of Income Taxes

Income Tax Expense (Benefit)

Effective Income Tax Rate (EITR)

Components of Deferred Tax Assets and Liabilities

Deferred Tax Assets and Liabilities, Classification

Adjustments to Financial Statements: Removal of Deferred Taxes

Netflix Inc., Financial Data: Reported vs. Adjusted

Adjusted Financial Ratios: Removal of Deferred Taxes (Summary)

Netflix Inc., Financial Ratios: Reported vs. Adjusted

Adjusted Net Profit Margin

Adjusted Total Asset Turnover

Adjusted Financial Leverage

Adjusted Return on Equity (ROE)

Adjusted Return on Assets (ROA)